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BUSINESS LIVE The medical schemes regulator has sent shock waves through the industry in announcing plans to scrap by March 2021 the pared-down schemes and primary health-care products used by low-income families. The move has also caught the Treasury on the back foot, with sources saying it was not aware of the plan. Without an alternative, the demise of these products could leave hundreds of thousands of families without access to private health care. The move will not only affect consumers but also throw a spanner in the works for medical schemes and insurers that have been developing cheap products aimed at low-income workers. Many of these products are subsidised by employers and, at a few hundred rand a month, cost a fraction of traditional medical-scheme cover. While the Council for Medical Schemes (CMS) said it was developing a new and more affordable prescribed minimum benefit package with a strong emphasis on primary health care, the package has yet to be costed. Industry sources are sceptical that it will be in place by the 2021 deadline. The development is at odds with a long-standing policy aimed at making health insurance and medical scheme cover more affordable for millions of people, said the country’s biggest medical scheme administrator Discovery Health. "It would force hundreds of thousands of families with current primary care and related policies, providing valuable access to affordable health care, to be out of cover. This means that they will lose valuable employer subsidies and will be forced to pay out of their own pockets for private GP and other care," said Discovery Health CEO Jonathan Broomberg. While only about 15.4 % of the population — or 8.92-million people — are members of medical schemes, millions more pay for private health care out of their own pockets. As many as 45% of households use private health-care practitioners, such as GPs or dentists, according to Insight Actuaries. CMS registrar Sipho Kabane issued a circular on December 4, saying no low-cost benefit options would be permitted going forward, and no more products based on exemptions to the Medical Schemes Act would be allowed after March 2021. Major concern Products caught up in this net include bargaining-council medical schemes that cover workers in industries such as transport and fishing, which have for decades been allowed to provide less cover than traditional medical schemes, as well as cheap primary health insurance products sold by the likes of Momentum, Sanlam and Discovery Life. The exemption framework had created opportunities for companies to offer products that were not in consumers’ best interests, Kabane said. "Our major concern is that they overpromise and underdeliver," he said in an interview with Business Day on Thursday. "The people that buy them think they are fully fledged medical scheme products. They think they have comprehensive cover, and only discover at the time of access [to care] that they do not." He said allowing products with different levels of cover to continue was at odds with the government’s plans for National Health Insurance (NHI), or universal health coverage. "The NHI talks about a comprehensive benefit package. If we allow the market to be flooded with packages that have no intention of being comprehensive, it will make the transition period very difficult." Board of Healthcare Funders (BHF) MD Katlego Mothudi said that the organisation was "deeply concerned" about the circular, and was subjecting it to a technical review to fully understand its implications. The BHF is an industry association for medical schemes and administrators.
Created at 2019/12/09 08:44 AM by Mediclinic
Last modified at 2019/12/09 08:44 AM by Mediclinic